Contents:

Welcome!
Upcoming Events
What's New
GrandMaster Update

NOTE: This archive references other sites on the World Wide Web. From time to time, an article's link may be moved or deleted from the host site. If you encounter an out-of-date link, please e-mail the thepayrollnews@canpay.com.

Welcome!

December 2001 - Welcome to the latest edition of The Payroll News. As always, please feel free to forward this newsletter to your friends and associates who are interested in keeping up with the latest changes in the Payroll industry. Or better yet, subscribe them for free using the Tell Someone About Us link.

Upcoming Events

Listed here are recent changes in legislation on Federal and Provincial levels that may impact your payroll calculations. Please view the following list for changes that affect your region.

FEDERAL:

November 13, 2001 - CPP Pensionable Earnings Ceiling Raised for 2002 - The CCRA has announced that the maximum pensionable earnings under the Canada Pension Plan (CPP) for 2002 will be $39,100. This amount is up from $38,300 in 2001. The increase reflects the growth in average weekly wages and salaries in Canada. (Full Story - 192 Words)

November 16, 2001 - EI Change to Encourage People to Take All Available Work - HRDC Minister Jane Stewart announced that the Employment Insurance regulation making "small weeks" a permanent and national feature of the Employment Insurance (EI) program has been approved and will be effective on November 18, 2001. By allowing EI claimants to exclude low-earning weeks (less than $150) for benefit calculation purposes, more people will be encouraged to accept available work. (Full Story - 430 Words)

November 26, 2001 - Minister of Finance Announces Budget Date - Finance Minister Paul Martin announced that he will present the 2001 federal budget in the House of Commons on December 10, 2001. (Full Story - 238 Words)

Alberta:

November 14, 2001 - SFI Earnings Exemption Increase for Families - Individuals on the Supports for Independence (SFI) program can now earn up to $230/month before their SFI payment is reduced, doubling the previous employment earnings exemption. "These changes will encourage parents to move towards independence," said Alberta Human Resources and Employment Minister Clint Dunford. (Full Story - 469 Words)

October 31, 2001 - Employer Premium Rates to Increase in 2002 - The WCB has re-evaluated employer premium rate subsidies due to rising medical costs and a sharp decline in the equities market. The average premium rate will rise by 27.3% in 2002, to $1.68 per $100 of insurable earnings. To help employers adjust to this move, the WCB will still use financial gains to subsidize 2002 premium rates by 13 cents per $100 of insurable earnings. (Full Story - 479 Words)

British Columbia:

November 28, 2001 - WCB Average Premium Rate to Rise in 2002 - The BC Workers' Compensation Board announced that the average base premium rate for employers in 2002 will rise one percent to $2.03 per $100 of worker assessable payroll from 2001. "Rising claims costs and declining financial markets are the key drivers putting pressure on employers' base premium rates in the future," said Sid Fattedad, WCB Chief Financial Officer. "Unless claims costs fall and financial markets rebound, BC employers will see higher overall rates in 2003." (Full Story - 661 Words)

October 29, 2001 - First-Job Rate to Address Youth Unemployment - The government is honouring another two of its election commitments by confirming an increase in B.C.’s minimum wage to $8 per hour and by putting a new measure in place to reduce youth unemployment. The first-job rate of $6 per hour will take effect Nov. 15 and will apply to the first 500 hours of employment, or roughly the first six months on a new part-time job. Employees will then move to the general minimum wage rate of $8 per hour. The first-job rate will not apply to those already employed or to job-seekers who have been previously employed for more than 500 hours. (Full Story - 440 Words)

Manitoba:

November 8, 2001 - WCB announces rate increase effective July 1, 2002 - The average premium rate charged to employers for WCB coverage will increase from $1.49 to $1.56 effective July 1, 2002. "This increase is due to the decline in the WCB's investment revenues and the prospects for the economy in 2002," said WCB Acting CEO Ron Perozzo. "Manitoba will have the lowest average WCB assessment rate among the provinces," added Perozzo. "This rate increase is effective mid-year to allow employers to include the increase in their 2002 budgets." (Full Story - 420 Words)

Newfoundland and Labrador:

November 19, 2001 - Minimum Wage to Increase in 2002 - The province's current minimum wage of $5.50 per hour will be increased in 2002. The minimum wage will increase in two increments, with a 25 cent increase to $5.75 per hour effective May 1, 2002, followed by a further 25 cent increase to $6.00 on November 1, 2002. (Full Story - 349 Words)

Northwest Territories:

Recent Policy Revisions - Calculation of Compensation Benefits - Policy 03.07, which sets out how the WCB determines your compensation (pension) benefits, was recently revised to address the concern that pension awards may not adequately reflect the effect of a workplace injury on a worker's earning capacity. Pensions are now reviewed by a Pension Assessment Committee to determine if a worker should receive an additional 50% or 100% of the basic pension amount. (Full Story - 149 Words)

Nunavut:

November 13, 2001 - Workers' Compensation Agreement Signed - Nunavut has extended a shared WCB agreement with the Northwest Territories. The agreement allows for the WCB to provide services in both Nunavut and the NWT. (Full Story - 223 Words)

Saskatchewan:

November 15, 2001 - Joint Agreement will Benefit Taxpayers - Finance Minister Eric Cline and Minister of National Revenue Martin Cauchon signed a framework agreement November 14th in Regina. It formalizes the existing working relationship between the province and Canada Customs and Revenue Agency (CCRA) for programs administered by CCRA on Saskatchewan's behalf. (Full Story - 377 Words)

Yukon:

November 5, 2001 - Comments Solicited on Draft Loss of Earnings Benefits Policy - The Board of Directors of the Yukon Workers' Compensation Health and Safety Board wants the public's comments on a draft Loss of Earnings Benefits Policy. The purpose of the Loss of Earnings Benefits Policy is to provide the methodology to be used for the calculation of a worker's loss of earnings benefits, as required under the Workers' Compensation Act. (Full Story - 317 Words)

The year-end release of GrandMaster Suite incorporates a number of changes that make it even easier to use the program and perform your payroll tasks. This year-end release will be available soon after the CCRA releases their final draft of this year's tax tables (generally near the middle of December). Some recent changes to the program include:

• Updated tax-tables and tax calculations for year-end procedures.
• Additional Pension Adjustment options when creating your T4/T4A file. These include Fixed Benefit x 12, Fixed Monthly Benefit, Percent of Contributions and Integrated with CPP/QPP.
• Enhanced the WCB functionality to support cross-province workers. You can now accurately calculate a worker's hours when they work in different provinces during the same pay period.
• Increased security for the Employee Profile (Payroll module) and the Profile Query (Human Resource module). These changes ensure that users without View Payroll Data or View Pay Rates privileges can not access restricted areas in profile screens. Security settings can be modified via the Update User ID tab in the Administration module.
• Adjusted the T4A report settings to include recent CCRA changes: the Recipient Business Number (BN) has been changed to Box 13 (formerly Box 12); the title for box 61 has been changed to Payer's Business Number (BN).
• Modified the functionality of the Employee Skills Assigmment dialog box. Changes include: adding command buttons in a visible location on the dialog box; adding a Save button that stores changes and keeps the dialog box open; preventing the dialog box from closing when you enter a skill and press the <TAB> key.
• Adjusted the program to display correct net pay amounts when using deduction calculation methods, 27, 68, and 78. In certain cases, the reported values were inaccurate after you edited the data for the initial employee in the calculation.

Stay tuned to CanPay's Product News page to receive the latest changes and release information for all GrandMaster products!

• • •

November 28, 2001 - GrandMaster II for Windows - CanPay is proud to announce the release of their newest product -- GrandMaster II for Windows! Now you can enjoy the ease-of-use and familiar features of the original DOS version, plus take full advantage of the benefits of the Windows environment.

All GrandMaster II users can upgrade to the new Windows version Free of Charge! To receive your copy of GrandMaster II for Windows, please send an e-mail request to sales@canpay.com. The product will be shipped to you on CD-ROM. If you do not have a CD drive, you can download the product from our website (available the week of December 3rd). If you have any other questions about the software or its installation, please e-mail them to support@canpay.com (please include GrandMaster II for Windows in the e-mail's Subject Line).

December has arrived and with it, the holiday season! For many employers, it's the perfect opportunity to show their appreciation for employees in the form of various gifts and offerings. Employers need to be aware of the new rules governing gifts or awards given by employers to their employees. These rules are effective for 2001 and subsequent tax years.

Non-Cash Gifts for Special Occasions

Employers are permitted to give their employees two non-cash gifts per year for special occasions. These gifts will be considered "tax-free" if they are presented for such occasions such as Christmas, Hanukkah, birthdays, and marriages. The total cost of the gifts, including taxes, must not exceed $500 per year. Employers are allowed to deduct the cost of the gifts for the taxation year in which the gifts are given.

Awards for Achievement Recognition

Employers are permitted to give their employees two non-cash awards per year in recognition of an employee's achievement. These gifts are considered "tax-free" if they are presented in recognition of employee achievements such as reaching a set number of years of service, meeting or exceeding safety standards, or other similar milestones. The total cost of the awards, including taxes, must not exceed $500 per year. Employers are allowed to deduct the cost of the gifts for taxation year in which the gifts are given.

Cash or Near-Cash Gifts

All cash or near-cash gifts are considered a taxable employment benefit. There are no exceptions to this rule. Near-cash gifts and awards may include such items as:

• Gift Certificates
• Gold Nuggets
• Any item that can easily be converted to cash

Gifts or Awards Whose Value Exceed $500

If the employer offers a gift (or gifts, to a maximum of two) that exceeds $500, the full fair-market value of the gift(s) will be included in the employee's income. In cases where the cost of the award (or awards, to a maximum of two) exceeds $500, the full fair-market value of the award(s) will be included in the employee's income.

These changes make it easier for employers to administer their gift and award programs because it removes the need to determine the fair-market value of small, non-monetary gifts and awards. That determination can be very subjective when the gift or award has a company logo.

These changes reflect current business practices and are in keeping with other positions set out in the Income Tax Act, Employees' Fringe Benefits section. Full details about this change can be viewed in the CCRA's January 2002 edition of the Income Tax -- Technical News.